Apple Says Now Is the Time for Pay Later

Apple Pay

For Apple, Pay Later will pay off for Apple Pay.

That’s the hope, anyway.

It’s no secret that the explosive demand from consumers for buy now, pay later (BNPL) has set off an explosion in the number of companies offering the option.

Now Apple, among the tech giants striving to cement its own eCommerce ecosystem, joins the BNPL crowd.

As had been widely reported on Monday (June 6), the company said in a release that it would launch Apple Pay Later.

And in the announcement of the pay-by-installment option, the company said users in the U.S. will be able to split the cost of an Apple Pay transaction into four installment payments over six weeks, with no attendant interest charged or fees levied.

In terms of the mechanics, the payments are done, tracked, and repaid through the digital wallet, and is available for online or in-app purchases, through the Mastercard network.


On the face of it, Apple Pay could indeed use a boost. Headed into the end of the third quarter of last year, PYMNTS’ own data showed that roughly 94% of consumers with Apple Pay activated on their iPhones did not use it in-store to pay for purchases. Seven years on, that stat might be seen as disappointing. It’s a rate roughly flat with the previous couple of years.

And yet, the dry kindling is there. Other PYMNTS data show that 70% of merchants accept Apple Pay.

Read also: Apple Pay Adoption Stats

And in a bit more granular detail on what might spur a greater embrace of Apple Pay, there’s also the debut of Apple Pay Order Tracking, which will let merchants deliver receipts and order tracking ability, integrated through Shopify, into the wallet.

As to the installment loans themselves, Apple has its banking partner in Goldman Sachs, and Apple is not shy about its “Breakout” ambition to become, at least in part, a financial services company.

Also see: The One Big Thing Apple’s Project Breakout Needs but Doesn’t Have

In musing, earlier this year, on what Apple’s BNPL might become, Karen Webster wrote that “Apple’s Installment program announcement could be a first step” toward fully forging a consumer connection, “perhaps even a V.1 for introducing Apple’s version of Amazon Prime.”

Introducing a bundle of hardware and software services provided by Apple for a set monthly fee creates a different relationship between Apple and its customers. BNPL, then, becomes a conduit to much more than just simply having visibility into cash flow — and certainly more than just playing catch-up with the Affirms of the world.

Having the installment options built in would, ostensibly, fuel consumer purchases of hardware, apps and all manner of other transactions. The interest is there and now the time is ripe to strike while the iron is hot — particularly as inflation makes us all a bit leery of traditional credit.

PYMNTS has found that among surveyed department store shoppers, for example, 46% said they are highly interested in using BNPL online, while 41% are interested in using BNPL in-store. BNPL’s appeal is greatest among millennials, 70% of whom said they’d use the option — and all of this sits squarely in Apple’s sights.

Read here: PYMNTS Intelligence: How BNPL Is Shaping Consumer Buying Behavior